Bad policies led to economic crisis – Soludo

- Chukwuma Soludo says the foundation for recession in Nigeria was laid by the previous administration, which he said, borrowed to fund recurrent expenditure at a time when oil prices was high

- Soludo states that Nigeria could overcome the current economic setback faster if the government put in place appropriate policies

- The former CBN boss says Nigeria failed to save funds at a time when there was unprecedented boom in oil prices

Former governor of Central Bank of Nigeria (CBN), Chukwuma Soludo, has blamed the country economic woes on bad government policies executed in the time of boom.

He said that the foundation for the recession was laid by the previous administration, which he said, borrowed to fund recurrent expenditure at a time when oil prices were as high as over 100 dollars to a barrel.

Soludo said this on Thursday, May 18, when speaking at the 2017 international conference organised by the department of business administration of Nnamdi Azikiwe University, Awka, Anambra state, The Cable reports

In a lecture entitled: “Managing a Recessed Economy”, Soludo said that managing and exiting a recessed economy was not a rocket science.

Soludo said Nigeria failed to save funds at a time when there was unprecedented boom in oil prices

The former CBN boss noted that Nigeria could overcome the current economic setback faster if the government put in place appropriate policies.

"Part of the problem Nigeria is having in its quest to get out of recession is poor policy,” he said.

“Huge spending by government was one of the ways of solving the economic problem, but two wrong steps by government ruined that.

“They brought in the treasury single account (TSA) and channelled funds into one account that did not allow spending… they also fixed the price of foreign exchange. These are things you do not do.”

He said Nigeria failed to save funds at a time when there was unprecedented boom in oil prices.

"Poor ideas transcended over superior ideas, and we went into recession which was slightly avoidable, that is why academics must be alive to their responsibility of nudging us to reality,” Soludo said.

“If you borrow at a time of boom, what will you do in a time of lack? Even my grandmother in the village knows this.

“At the same time when we had boom, we had unprecedented unemployment.

“The problem with Nigeria’s successive policy makers is that once oil goes up, we take it that it will remain so, and we continue to spend.

“But once there is a shock and oil goes down, we just think it is temporary and we start borrowing.

“Nigeria can be fixed, and what it needs to fix Nigeria is not rocket science, but we do not have the will to fix her.”

According to Vanguard, Soludo advocated diversification of the economy beyond oil to save it from shocks induced by vagaries of the International oil market.

He also called for decentralisation from Abuja to help the states and local governments live beyond “running to the centre for their existence and sustainability”.

"Another way of tackling the challenges of the country is to unbundle Abuja, trim down the exclusive list.

“We do not have to be running to Abuja for everything, that was why I was surprised when some people canvassed that local governments should be going to Abuja to take their allocations directly,” he said.

Osinbajo said the present administration was committed to ensuring that government and its citizens patronise locally made products.

The acting president made the statement at an interactive session he had with top government officials on the ease of doing business at the old Banquet Hall of the Presidential Villa, Abuja on Thursday, May 18, The Punch reports.

He said the government would work out incentives for performance by building reward system that punishes malfeasance and that preference must be given to indigenous providers of goods and services to strengthen the system.

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